Sunday, May 3, 2009

Should Poker Be Considered Gambling?

Here are my thoughts:

One definition of gambling I found is:

Gambling is the wagering of money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods. Typically, the outcome of the wager is evident within a short period.

By this definition all poker players are gamblers and all casinos are gambling against their customers. Because of that I don't like the definition.

I would define gambling as the act of wagering on an event where the individual or entity wagering is at a disadvantage (has negative expected value) or is at risk of losing all of their money if they were to continue making this wager.

By my definition, a casino is not gambling against the vast majority of their customers. It's evident casinos are profitable businesses largely due to gaming. As long as the casino sets table limits that ensure no risk of ruin, they are guaranteed to make money as long as people with negative expectation keep wagering.

Similarly, a good poker player has an edge against the vast majority of their opponents. If they play within their bankroll, at limits that afford them no chance of going broke, against these opponents, they are identical to a casino. They can lose on any given day, week, or even month just like a casino but given enough time they will assuredly win. When you're guaranteed to win over time with zero risk of ruin, that ain't gambling as far I'm concerned.

So back to the question of "Is poker gambling?" For the players that have negative expectation, yes. For the players with insufficient bankrolls in relation to the limits they're playing, yes. For the players that have an edge and are playing limits that ensure they have no chance of going broke, no.

5 comments:

  1. one could argue that a player with a negative expectation isn't gambling either since it is a definite over time that they will lose.

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  2. I agree if the person continually wagers over a long period of time. At that point they have virtually no chance of winning.

    Thoughts come to mind of J Miskinnis who used to buy every pull tab in the box even when there were no prizes above $100. At that point you're not gambling, there's nothing to win.

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  3. I should add if the person continually wagers over a long period of time where the payoff is small relative to what they are wagering. So I wouldn't include lottery and progressive slot players in the non-gambling negative expectation category.

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  4. "...where the individual or entity wagering is at a disadvantage (has negative expected value) or is at risk of losing all of their money if they were to continue making this wager."


    The individual or entity is not conscious of being at a disadvantage? Or is conscious? If he is conscious yet still wagers, then he is a gambler. Well, one could argue that if he is not conscious of being at a disadvantage then that means that he is uncertain about who has the advantage. A gambler is to wager with uncertainty or knowing that he is at a disadvantage.

    So, your point is that poker players are not gamblers because they know their skills and they have the ability to minimize the risks and maximize the profit just like the Casinos, right?

    Now with lottery tickets, it's something that you don't use skills or have the ability to minimize the risks so buying a ticket would make you a gambler?

    This is an interesting discussion.

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  5. I think the vast majority of gamblers are overly optimistic and believe they are going to win despite the odds. So it's not that they don't know they're at a disadvantage, they just choose to ignore it.

    Poker is a little different though since it's very tough to estimate your advantage or disadvantage. And even if you could, it would change every time a new player sat at your table. There certainly is a segment of poker players that are losing players who believe they are winning players - this is the beauty of poker and variance. To me these people are gambling regardless of what they think they're doing.

    Yes I believe winning poker players playing within their bankroll are not gamblers the same way a casino is not gambling with it's customers (based on my redefinition of gambling).

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